Lockdown recovery 1.0 or is that 5.0?It seems that the whole country is now facing a scenario we all know all too well in Victoria (Vic). Lockdown 5.0 has seen Victorians face six months of lockdown restrictions affecting individuals and businesses. Residents and businesses of Greater Sydney and parts of New South Wales (NSW) are now facing the same financial challenges, which reportedly some businesses/industries may not survive. This article outlines the individual and business financial support that state and federal government has available to date; including some tips on what to do if you’ve been impacted.
Employees or individualsVictorians who are directed to isolate until they receive their COVID-19 test results, are unable to work, and won’t get paid by their work can apply for the $450 test isolation payment. From the national angle, following JobKeeper’s end on 28 March 2021 the Federal Government pivoted to the COVID-19 Disaster Payment on a discretionary basis. People in NSW, Vic, and South Australia (SA) who’ve been told to self-isolate or quarantine, or are caring for someone with COVID-19 could get paid up to $1,500 for each 14-day period. To apply, a Centrelink online account is required, which must be linked to the relevant myGov account.
BusinessHaggling has long-been in consumer’s domain to seek a better deal for products and services. It is time business does the same. Most state/territory governments have tools on their Coronavirus business financial support websites to help discover what financial support is available from federal, state/territory and local councils. Here’s a summary of some of the available support for business and some tips on what to do if you’ve been impacted:
- Seek rent relief from landlords.
- Check what assistance is available from the bank.
- Know what fee waivers is available from councils.
- Contact the Australian Taxation Office (ATO) to discuss additional relief. Click here for more how the ATO’s current approach to debt collection.
- Contact the State Revenue Office (SRO) for payroll tax/land tax waivers, deferrals, and exemptions.
- Apply for state/territory financial support for business.
Seek rent relief from landlordsThe SME Commercial Leasing Principles Code applies to all tenancies suffering financial stress or hardship as a result of the COVID-19 pandemic. Regulation is being introduced by to give the Code effect to assist landlords and tenants to negotiate in good faith for rental relief during the pandemic. Landlords can claim the cost of the rent relief through a concession on their land tax. The Code’s guiding principles detail that each lease is different and should be dealt with on a case-by-case basis. Obviously, landlords and tenants share a common interest in working together, to support continued business and the recovery period. Click here for more on what rental relief is available.
Financial institutionsMost financial institutions have a support package for all businesses, irrespective of geography or industry. The assistance measures include:
- deferring loan repayments
- discounting the standard rate for plant and equipment finance
- refunding merchant fees and charges
- deferring interest payments
- offering additional finance to help cover cash-flow shortages.
CouncilsLocal economic packages to support businesses are outlined on local council websites, which may include:
- offering one-on-one advice and support through a business concierge service
- providing rent relief for tenants in council-owned and managed buildings
- waiving or suspending fees, rates and licence payments
- reducing registration fees for food businesses
- offering grants to develop online and electronic services (e-services)
- offering business mentoring.
ATOThe ATO is offering additional support on tax obligations—including lodgment or payment—including repayment plans for existing and ongoing tax liabilities. For existing payment plans, the ATO can adjust repayments. Consideration is also available to remitting interest and penalties incurred after 23 January 2020 and varying PAYG instalments and changing GST reporting cycles from quarterly to monthly. Some borrowers with Division 7A loans may be unable to pay the minimum yearly amounts for the last two income years. Borrowers can apply for an extension to make their repayments, however the shortfall must be paid by 30 June of the following year.
State Revenue Office (SRO)The SRO is supporting business with land and payroll tax relief including:
- waiving and deferring tax for eligible businesses
- providing additional time for dealing with tax affairs
- providing lodgement deferrals for upcoming lodgment dates
- offering payment deferrals for amounts that may be due
- allowing for flexible payment plans
- providing remissions to interest charges.
COVID-19 business support grantsAll states and territories except for Vic and NSW have a suite of COVID-19 business recovery support packages. Measures include grants for affected industries such as tourism, accommodation and food services; and waivers of government fees, rent and charges. However, due to the length of lockdowns in Vic and now NSW, the most significant need for business assistance and support are in those states.
VicThe Vic government support for businesses impacted by lockdowns are outlined in the table below.
|Business Costs Assistance Program|| |
|The $20 million Victorian Events Support Package||Supports operators in the events industry with five separate programs under the package, see below.|
|Impacted Public Events Support Program Grants of $25,000 to organisers of Tier 1 and Tier 2 events under the Public Events Framework—postponed or cancelled—following restrictions announced from 27 May 2021.|
|Independent Cinema Support Program Support for independent cinemas unable to operate with a payment of up to $12,000 per cinema venue.|
|Live Performance Support Program (Presenters) Grants of up to $7,000 for eligible live performance event presenters.|
|Live Performance Support Program (Suppliers) Suppliers of goods and services involved with live performance events will be eligible for a grant of $500 per event.|
|Sustainable Event Business Program Grants of up to $250,000 to major event organisers, hosts and suppliers significantly affected by the restrictions from 27 May 2021.|
NSWThe NSW government through Services NSW has a range of financial support to businesses impacted by the recent COVID-19 restrictions, which include the following:
- COVID-19 business grant: A one-off payment to help businesses impacted by the current Greater Sydney COVID-19 restrictions. Grants $7,500 - $15,000 available to eligible businesses depending on turnover decline experienced during the restrictions.
- COVID-19 micro-business grant: A fortnightly $1,500 payment for businesses with a turnover of $30,000 - $75,000 but has experienced a minimum of 30% turnover decline.
- JobSaver payment: Fortnightly payments to help maintain employee headcount and provide cash-flow support to businesses with a turnover of $75,000 - $50 million; that experienced a minimum of 30% turnover decline Payments are either:
- Employing businesses—40% of weekly payroll, with a minimum payment of $1,500/week and a maximum payment of $10,000/week
- Non-employing business—$1,000/week.
- Small business fees and charges rebate: Small businesses may apply for a $1,500 rebate to help them pay for government fees and charges.